Global Metals Outlook 2015: Innovating for growth

Metals 2015: Innovation

Metals organizations know that the introduction of new products – such as ultra-light alloys – and services can drive future growth. And many say they will increase their R&D spend to capitalize on these new opportunities.

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While data suggests that investment into R&D is set to increase, cost considerations remain high on the agenda for most metals organizations. As such, many are hoping to leverage partnerships and to collaborate with customers to drive innovation and growth.

Our data suggests that metals organizations expect investment to increase significantly over the next 2 years. In fact, whereas just 11 percent report that they invested upwards of 6 percent of revenues into R&D in the past, almost a third say they plan to spend that amount over the next 2 years.

  • 32 percent of metals organizations will spend more than 6 percent of revenues on R&D over the next 2 years
  • 70 percent will allocate investments towards projects that deliver incremental innovation.

In part to further mitigate the risk of innovation – but also to drive down costs and improve speed to market – metals organizations are becoming increasingly focused on entering into partnerships to drive innovation.

  • 85 percent expect partnerships to drive new innovation
  • 81 percent are collaborating more with suppliers and customers
  • 36 percent say that their primary reason for collaborating on innovation is to lower their R&D costs.

“Metals organizations want to spend more on R&D and firmly believe that innovation will be a key growth lever in the future. Indeed, going forward, the best opportunities for revenue growth and profitability will likely be found in technologically-advanced products as opposed to commodity products. - Eric Damotte, KPMG Global Head of Metals

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